Will the PIGS slop our economy too?

Discussion in 'Economy' started by The Rabbi, Apr 28, 2010.

  1. The Rabbi
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    The Rabbi Diamond Member

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    With Greece probably about to default, and downgradings with Spain, Portugal, and Italy in the works, what are the chances of that economic crisis spilling over and causing a double dip recession in this country? Added to that the potential default by California, Michigan, and New York the economy is looking less than stellar.
     
  2. Old Rocks
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    Old Rocks Diamond Member

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    Naw, we got the Republicans out of office. We will do the neccessary things to prevent a meltdown, against united Republican opposition, of course.
     
  3. The Rabbi
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    The Rabbi Diamond Member

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    You mean throwing unprecedented levels of borrowed money at failing entities and creating speculative bubbles? Yeah, that's a plan all right:cuckoo:
     
  4. william the wie
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    william the wie Gold Member

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    Two corrections Rabbi, the Spanish banking system is in excellent shape with a huge bond sales franchise in Latin America that somewhat insulates Spain from the international bond market and you didn't include Illinois in your list of states likely to default. Otherwise you are dead on.
     
  5. Paulie
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    Paulie Platinum Member

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    What are you guys talking about, the DOW is at 11,000 :lol:
     
  6. Toro
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    Toro Diamond Member

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    Maybe. Sovereign defaults are serious.

    Greece is irrelevant. What matters is if it spreads to the rest of the EU.

    I bought gold today.
     
  7. The Rabbi
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    The Rabbi Diamond Member

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    It's an issue of their sovereign debt.
    Amid Rush to Aid Greece, Spain Looms as Bigger Problem - NYTimes.com
    The country was just downgraded and potentially is much worse than Greece, being larger.
     
  8. Big Black Dog
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    Big Black Dog Gold Member Supporting Member

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    At the rate Owe Bama and his dumb ass Congress are spending money, we will most likely be next to go down the tubes.
     
  9. william the wie
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    william the wie Gold Member

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    Yeah I heard that today. As an apology take a look at Spanish banking in Latin America and see what kind of thread suggests itself. Hint normal arbitrage is to short the domestic bond and go long Spanish bonds.
     
  10. Toro
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    Toro Diamond Member

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    Spain's deficit is lower than Greece's, its total debt is lower, more of its debt is financed internally, and there is no evidence of a massive cover-up of its liabilities, unlike Greece.

    But that doesn't mean it can't succumb to contagion.
     

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